The Colombian Peso! (D)

Previous analysis outlined the expectation for price to fall and that is just what occurred with price dropping over 10% to just above the outlined support from a previous swing high. Price turning back up above this support level kept the uptrend in a strong position and new highs were subsequently seen.
 
That brings us to the present where I believe another substantial drop in price is set to take place. Let’s take a look using the daily chart.
 

USDCOP DAILY CHART

 
Price hit a high a few days ago at 3,453.9000 and this looks to have set up a “three strikes and you’re out” topping formation which is denoted by the numbers 1,2 and 3.
 
The RSI shows a quadruple bearish divergence at this high while the MACD indicator is now bearish.
 
I have drawn two bullish Fibonacci Fans so let’s run through them.
 
The fan drawn from the May 2015 low shows the first strike high at resistance from the 50% angle. Price then corrected back to the 61.8% angle where support came in and price crawled higher along this angle to put in two more strikes to end the trend. Price now looks to be threatening to break below this support angle.
 
The fan drawn from the November 2015 low shows the second strike high at resistance from the 50% angle before correcting back to the 61.8% angle and then crawling up this angle to put in the third and final strike high. Price has now broken below this support angle and there is a big gap down to the next 76.4% angle.
 
The upper horizontal line denotes the previous swing low at 3,260.6000 and price needs to break below there to confirm the downtrend.
 
The lower horizontal line denotes the November 2015 low at 2,784.9000 and that is the next serious support level.
 
Summing up, I believe a top is in place and an intermediate downtrend is now in play.
 
 

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Disclaimer

All information contained in this website is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors. Put simply, it is JUST MY OPINION.

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